What is Really Happening at Nikon and Canon?

Could someone please explain to me what it is exactly the research and development labs at Nikon and Canon are doing?

I ask because their ongoing strategy implies that they are working in a vacuum which is a suicidal tactic in an interconnected world.

As I write this, Amazon is shipping my new D750 Nikon Dslr. It is easily one of the best I have ever owned (and I have owned quite a few cameras). Yet, like billions of other cell phone users around the world, when I want to capture a fleeting moment, I don’t look for my Nikon. I simply pull out my cellphone and swipe a button.

Proof you ask? Well, simply pause your reading and pull out your cell phone. All the evidence needed to incriminate you is right there in your photo gallery. I have images on my cell that are several years old.
There is no escaping it: mobile phones have become our default way of life and the world’s first truly transnational culture. According to the GlobalWebIndex, more than 80% of online adults own a smartphone and 47% own a tablet. It is not a leap of faith to say that virtually all those cellphones have a camera built in.

How can giants and consummate professional such as Nikon, not have a stake in this market? It is downright inconceivable. Have they grown tired of making profits?

People are getting by on the cameras on their cell phones because it is simple, reliable, the image quality is rapidly approaching perfection (some phones can shoot 4k videos) and, most importantly, it is a “cell-camera.” All the advantages that come with having an independent, mobile telephone line or internet browser also apply to the cameras built into a cell phone. Barring a shower (and some phones are water-resistant), a “cell camera” is always by your side. A cell camera can take selfies, action shots, edit images, provides automatic image stabilization, and so much more. Smartphones, with their inbuilt cell-cameras, are the new compacts and no one wants to carry around additional gear. Trust me, this is what regular folks want. They don’t want to 50 mega-pixels or 40 fps cameras.
According to the statistics website Statista, Global revenue from smartphone sales is set to top a whopping $264.75bn. According to data from the International Data Corporation (IDC) Worldwide Quarterly Mobile Phone Tracker, vendors shipped a total of 334.4 million smartphones worldwide in the first quarter of 2015 (1Q15), up 16.0% from the 288.3 million units in 1Q14 but down by 11.4% from the 377.6 million units shipped in 4Q14. Android dominated the market with a 78.0% share in 1Q15. Samsung reasserted its global lead with a renewed focus on lower-cost smartphones.

On another hand, overall global digital camera sales declined by a significant 34.5% in the first two months of 2014 as compared to the same time span in 2013. The implication of these numbers is simple: most people are quite satisfied with the cameras in their phones. Very soon, professionals will be the only players in the camera market and they simply do not provide enough of a profit margin to keep dinosaurs out of the red.

Why hasn’t Nikon or Canon come up with a flagship phone, if only to secure their compact camera segment? They do not even need to build the Operating System: there is Android, and it’s free. They obviously have the money and the technological and intellectual capital needed to construct cameras superior to that of many phone manufacturers. The smartphone market is huge and continues to grow with the introduction of low-end and low-cost smartphones that come with cameras. Some of these cameras are not great, but guess what? They’ll do just fine. You know that saying “The best camera, is that camera that you have with you”.

The techies at Canon and Nikon are busy fixing imaginary problems while the very ground (i.e. the market) is shrinking beneath their feet.
As if this isn’t bad enough, Nikon and Canon have no stake in the app world market as well. In April 2012, Facebook purchased Instagram for $1 billion. A Citigroup valuation in Dec 2014 put Instagram at $35 billion. A profit margin of $34 billion in 730 days is a market changer. All the more so when we consider that the 98-year-old Nikon is currently valued at $6.7billion and Cannon’s entire business at $49.8billion as of May 2015.

Why didn’t anyone in the innovation labs at Nikon or Canon think of an app like Instagram or any photo-sharing app for that matter when apps began to bloom?

Outsiders are redefining the entire photography landscape while the industry insiders continue to wage war against each other, completely oblivious to their rapidly accelerating extinction.

As a professional photographer, I love my Nikon gear. But not everyone needs pro gear. People clearly prefer something convenient they can carry around and use immediately. Even professionals are calling for smaller cameras with many evening using pictures taken with their iPhones for production work.

Innovation is not about making a faster horse, it’s about making a car and these guys are beating a dead horse.

We clearly have another “Kodak” case on our hands. Consumer behavior has changed. Brands that focus on trends, and innovate along those lines reap the rewards. Those that do not, face extinction.

I for one would love to wake up one morning to the news of a 6 inches, Nikon, full frame, smartphone camera, with dual sim, LTE and a super amoled screen with a 6000 amhs battery. I would go bonkers over such a device. Yes it must also shoot raw with at least 512GB in-built storage – (well at least something along those lines Not only would I get it but a lot of pros would dump their iPhones and Samsungs for it .

Have I mentioned that a few smartphones now shoot raw? It’s crazy stuff.

The battle is not lost. The smartphone market is still an open playing field. Nikon and Canon need to get into that space and innovate. Fire every single soul they have in their innovation lab and get to work. It’s a move that is long overdue . They could start by just making high-end lens that attaches to iPhones and Android devices for a start(Sony is already playing here though), then they could move into apps and eventually their own mobile phones.

They have the capital, the technology. All they need is the wisdom requisite to change their game and tap into the every growing billion dollar smartphone market.